Real Estate

5 Biggest Mistakes To Avoid When Buying a Home in the Cayman Islands

December 14, 2020
Spread the love

Trying to navigate the real estate landscape alone as a foreigner in a foreign place is almost a guarantee for disaster unless you have a solid plan in place.

Even with a professional real estate broker looking after you, there is plenty of scope for mistakes and poor decisions when thinking about buying property for sale in the Cayman Islands. Here are the top five mistakes to avoid:

Poor Location Choice They do go on about it. Still, real estate agents are correct: it’s all about location, location, location, and in this respect, the Cayman Islands are no different from any other place with a busy property market. Choosing a home before considering the area is a huge no-no. Where are the supermarkets, amenities, schools? What’s the state of the highway commute? Will you get overrun by tourists or cruise passengers or weekenders? What sort of neighbours do you want, or want to avoid? Don’t fall into the trap of buying a home without knowing local market conditions and the surrounding community. Consider renting short-term in your chosen area and getting a feel for the neighbourhood before committing to a potentially unsuitable property purchase.

Failure to Calculate Finances Not being financially prepared is another big potential mistake. Most banks offering housing loans in the Cayman Islands require a 10% deposit (for local citizens) and up to 30% for buyers that are permit-based or overseas. There’s no annual property tax in the Cayman Islands or any other direct taxation. Still, there is a one-time stamp duty of 7.5% payable on purchase, as well as lawyer and insurance costs to take into consideration.

Not Getting a Thorough Inspection It’s essential to have a professional engineer conduct a home inspection of the structure, the fittings, and the roof. Remember, the Cayman Islands experience a lot of hurricane winds, salt spray, and high humidity – all the ingredients for a rapid deterioration of property without constant maintenance. A home inspection will alert you to expensive defects such as a leaky roof, crumbling foundation, flood damage, bad wiring, leaky plumbing, a worn-out HVAC system, or a pest infestation. That may not be apparent until after it becomes your (huge) problem. 

Spending Big, Not Wisely Another temptation is to splash out and buy the ritziest house on the block. If you have the wherewithal and you plan to make it your forever home, then fine. But you are likely to find that when you want to resell, you have an asking price far higher than that of other homes in the area. Meaning you are required to justify every single extra dollar you’re asking for, with the result that buyer interest in your expensive Cayman Islands luxury property will be limited. A better strategy is to buy the cheapest property in the most expensive area and then spend money to improve it to build equity.

Rushing a Decision Less haste more pace is the lesson to learn here. Visit first, look around, take your time, do your research, and visit as many potential homes as possible. Keep copious notes and photos of each house you see and your thoughts on them. Messages and pictures work far more effectively than relying on your memory alone. Moving slowly and deliberately results in an informed and smart purchase.

Buying a home is fraught with messy detail. Buying a home in the Caribbean can be fraught with messy detail you never even considered. Keep the above points in mind, and your Cayman Islands real estate purchase should be useful for both your wallet and your happiness.